ROC % measures how well a company generates cash flow relative to the capital it has invested in its business. It is also called ROIC %. Covenant Logistics Group's annualized return on capital (ROC %) for the quarter that ended in Mar. 2026 was 2.18%.
As of today (2026-06-24), Covenant Logistics Group's WACC % is 12.67%. Covenant Logistics Group's ROC % is 1.56% (calculated using TTM income statement data).
Covenant Logistics Group earns returns that do not match up to its cost of capital. It will destroy value as it grows.
Covenant Logistics Group (FRA:CV5) ROC % Explanation
ROC % measures how well a company generates cash flow relative to the capital it has invested in its business. It is also called ROIC %. The reason book values of debt and equity are used is because the book values are the capital the company received when issuing the debt or receiving the equity investments.
There are four key components to this definition. The first is the use of operating income or EBIT rather than net income in the numerator. The second is the tax adjustment to this operating income or EBIT, computed as a hypothetical tax based on an effective or marginal tax rate. The third is the use of book values for invested capital, rather than market values. The final is the timing difference; the capital invested is from the end of the prior year whereas the operating income or EBIT is the current year's number.
Why is ROC % important?
Because it costs money to raise capital. A firm that generates higher returns on investment than it costs the company to raise the capital needed for that investment is earning excess returns. A firm that expects to continue generating positive excess returns on new investments in the future will see its value increase as growth increases, whereas a firm that earns returns that do not match up to its cost of capital will destroy value as it grows.
As of today, Covenant Logistics Group's WACC % is 12.67%. Covenant Logistics Group's ROC % is 1.56% (calculated using TTM income statement data).
Covenant Logistics Group earns returns that do not match up to its cost of capital. It will destroy value as it grows.
Be Aware
Like ROE % and ROA %, ROC % is calculated with only 12 months of data. Fluctuations in the company's earnings or business cycles can affect the ratio drastically. It is important to look at the ratio from a long term perspective.
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
Note:
The Operating Income data used here is four times the quarterly (Mar. 2026) data.
The tax rate is limited to between 0% and 100%.
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
Covenant Logistics Group (FRA:CV5) has a ROC % of 2.18% as of Mar. 2026. Return on capital is the ratio of current-period net income to average two-period capital. View historical data on Covenant Logistics Group and its competitors.
Is Covenant Logistics Group's ROC % too high?
Covenant Logistics Group's current ROC % is 2.18%. The Transportation industry median ROC % is 4.69. Covenant Logistics Group's value of 2.18% is 53.5% below this industry median. Overall, Covenant Logistics Group has a GF Score™ of 68/100, reflecting its overall financial health beyond just this single metric.
How does Covenant Logistics Group's ROC % compare to HTLD and MRTN?
Covenant Logistics Group's ROC % of 2.18% can be compared against companies in the Transportation industry. The industry median ROC % is 4.69. Covenant Logistics Group's value of 2.18% is 53.5% below this benchmark. See the competitive comparison table and distribution chart on this page for a detailed peer-by-peer breakdown.
What is a good ROC % for a Transportation company?
The median ROC % among Transportation companies is 4.69, based on 994 companies in the industry. Companies in the top quartile (top 25%) have a ROC % significantly above this median, while those in the bottom quartile fall well below. However, ROC % should not be evaluated in isolation — investors should consider it alongside profitability, growth, and financial strength metrics. Covenant Logistics Group's current ROC % of 2.18% is 53.5% below the industry median. Use the industry distribution chart on this page to see where any company falls relative to its peers.
What does a high ROC % mean?
A high ROC % can signal that a stock is expensive relative to its fundamentals. Return on capital is the ratio of current-period net income to average two-period capital. View historical data on Covenant Logistics Group and its competitors. For the Transportation industry, the median ROC % is 4.69 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Covenant Logistics Group's current ROC % is 2.18%. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Covenant Logistics Group stock overvalued right now?
Covenant Logistics Group (FRA:CV5) has a current ROC % of 2.18%. The stock's GF Value™ is €23.50, compared to a current price of €37.40 — trading 59.1% above its estimated fair value. The current ROC % is 2.18% and 53.5% below the Transportation industry median of 4.69. Covenant Logistics Group's overall GF Score™ is 68/100 with 10 warning signs to review. Investors should evaluate multiple metrics — including profitability, growth, and financial strength — before making a decision.
How is ROC % calculated?
ROC % is calculated from a company's financial statements. For Covenant Logistics Group (FRA:CV5), the current ROC % is 2.18% as of Mar. 2026. GuruFocus calculates this using data sourced from SEC filings and annual reports. See the calculation section and 30-year financial data on this page for the full breakdown.
Is Covenant Logistics Group (FRA:CV5) Overvalued in 2026?
Based on GuruFocus' analysis, Covenant Logistics Group stock appears to be overvalued.
The current stock price of €37.40 is trading 59.1% above its estimated GF Value™ of €23.50.
Key valuation signals for FRA:CV5:
ROC %: 2.18%
GF Value™: €23.50 vs. price of €37.40 (59.1% above fair value)
Industry Position: 53.5% below the Transportation median
No single metric tells the full story. See the FRA:CV5 stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Covenant Logistics Group Inc together with its wholly-owned subsidiaries, offers truckload transportation and freight brokerage services to customers throughout the continental United States. The company's reportable segments include Expedited, Dedicated Services, Managed Freight, and Warehousing. The expedited segment provides truckload services to customers with high service freight and delivery standards. Dedicated segment provides customers with committed truckload capacity over contracted periods with the goal of three to five years in length. The Managed Freight segment includes brokerage services and TMS. The warehousing segment provides day-to-day warehouse management services to customers who have chosen to outsource this function.
68GF Score
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